Why don't construction prices go down?

Who wrote it anywhere here. Today the bank includes €920 in ancillary and operating costs and reserves for a single-family house in the financing. So let's say around 1000 euros is the monthly cost for a standard single-family house today. Now everyone will scream again, for some it is less or sometimes more. There remains the question of who wants and can finance for 40 years. Paying off from 30 to 70 years? But in these 40 years it will also have to be partly renovated again. Maybe the legislator wants 30 cm of Styrofoam insulation on the exterior wall in 20 years. we don't know. I would say, even with a net income of 5000 it is already quite tight today for a newly built single-family house and a reasonably normal lifestyle. No matter where in Germany. And we are talking about a gross household income of about 10,000 euros per month. That is already sad. To put it bluntly, if someone had been told 22 years ago that today it is no longer possible to build a house with a monthly income of 20,000 DM, what would he have said? Really crazy.

No matter where in Germany.

Nope. The building plot on which my garbage bins stand here costs more than the building plot for a single-family house does elsewhere. The building plot alone costs about 1 million here, and then we're talking about minimum building size and outskirts.

Also here: We have gotten used to just saying "then I'll move to XYZ and build a house there." A rethink is needed, and that is not always pleasant.

Who wrote that anywhere here? The bank today includes €920 for additional operating costs and reserves for a single-family house in the financing.
So let's say roughly €1000 is the monthly cost today for a standard single-family house. Now everyone will scream again that for some it’s less or sometimes more.

I’d like to write something about that and have already posted tables. After all, I work at "the bank" ;-)
No, "the bank" (at least almost all) does NOT include flat-rate additional operating costs in the financing. These costs are indirectly taken into account through a cost-of-living flat rate.
Furthermore, one should distinguish between new construction – where the first reserves are needed after 20 years (available reserves, no savings) – or old buildings. You should always have some money in the account for those.

Then there remains the question of who wants and can finance for 40 years. Pay off from 30 to 70 years old?

The misconception that "one" must have paid off their house by age 60 arose when interest rates plummeted. This results from the then available possibility to easily increase the repayment rate. It was also reasonable, otherwise financing terms of almost a century (mathematically) would have resulted.
But where is the problem in still having an outstanding balance in retirement? Every renter faces this problem – so almost two-thirds of Germans still have to pay the full amount for their accommodation in retirement. Every homeowner can only laugh about that. Even with an outstanding balance.
My own financings run – mathematically – until I am 90. So what? Whether I have a €400 payment in retirement or not, doesn’t interest me at all. With that, I will still pay about €1,500 less over 15 years than the renter next door.

Nope. The building plot where my garbage bins are located here costs more than the building plot for a single-family house elsewhere. The building plot alone costs about 1 million here, and then we're talking about minimum building size and the outskirts of town.

also here: We have gotten used to simply saying "then I'll just move to XYZ and build a house there." A change of mindset is required, and that's not always pleasant.

Of course, that also has its limits. You often pay for lower land prices with time—commuting one hour each way, five days a week, is no fun. Leaving aside the costs, because the cheaper plot usually means that you have no choice but to use a car for commuting instead of public transport with the 49€ ticket. For us, it only works because I work from home four days a week.
And even then, you have to be aware that there are limits to it. 500k for land, house, ancillary building costs, and outdoor facilities is already on the cheap side. But with 20% equity, that still means a 400k loan with at least a 2000€ monthly installment, of which 1600€ is interest alone. For average earners, that’s hardly achievable.

For average earners, this is hardly achievable.

Whereas the average earner could neither build in 1950, nor in 1980, nor in 1995. That has always been reserved for "privileged" higher earners. The average earner has always bought an apartment or a second-hand property, if feasible.
We, who exchange ideas here, lie (except for the self-builders) above, well above, or extremely above the average household in Germany with "only" 3.8xx€ net.

Privileged people and privileged projects are discussing here!

Sorry, that was somewhat exaggerated at times and I do see the arguments of the prices-can-only-rise faction, but I find it hard to accept certain inconsistencies in the consequences of this statement. However, I also come from the I-want-to-build faction with wishful thinking that prices can fall.

It's just the typical crystal ball, but there still seem to be quite good indications. In my opinion, the construction cost index shows quite well that price crashes in new construction have hardly ever occurred. Stagnation – yes. This fits with the saying – the best time to build was always yesterday. Nevertheless, "now" is probably always the second best choice..